Impact of Micro-Credit Programs on Self-Employment Profits, the Do Non-Credit Program Aspects Matter?

Micro-credit programs provide a two-tiered approach to poverty alleviation: credit for the purchase of capital inputs to promote self-employment and non-credit services and incentives. These non-credit aspects may be an important component of the success of micro-credit programs. This paper uses primary data on household participants and non-participants in Grameen Bank and two similar micro-credit programs to measure the total and non-credit effects of micro-credit program participation on productivity. I find large positive effects of participation and the non-credit aspects of participation on self-employment profits